With all eyes on its government finances and rate of unemployment, the dominant view of Spain is that it will be in dire economic straits for a long time to come. Few people know that there is also a flip side: new forms of social innovation and a range of social approaches to business are to taking root in Spain's economic and political fissures. As the bankruptcy of the country's previous growth model is becoming more painfully obvious by the day, tuning in to these emergent trends may well hold the key to a more hopeful story.

While avoiding clichés of silver linings to the dark cloud hovering over Spain, there are some remarkable developments that warrant recognition. A wide range of entrepreneurial people are coming together and starting to build new economic, social and civic initiatives because of the solutions they could offer to the country's biggest problems, like youth unemployment and an ageing society dependent on state pensions. And there's actually some fertile ground to build on, in the form of a long co-operative tradition.

Everyone loves Mondragón

The success story of Mondragón, once a humble co-operative that produced paraffin heaters and now the sixth biggest business in the country, is well-known. It's a hopeful story for creating scalable, commercially successful enterprises with a resilience rooted in explicitly social approaches to business.

Less well known is that Spain's co-operative sector now consists of 22,000 cooperatives, providing 1.2m direct and indirect jobs and a total turnover of €60bn according to CEPES, the Spanish Business Confederation of Social Economy.

A recent article in El Pais quoted Spain's Ministry of Employment as saying that from January to March 2013 a total of 223 businesses of this type were created.

Many of these are picking up where the state is retreating, like the case of Aquasport. This sports centre and swimming pool in Gerena (Seville province), was built when the going was good but stood mostly empty due to the lack of public funds. This led four locals to start a co-operative which successfully tendered to run the building and they are making it work, not just as a sports centre but also for festivities, dance classes and other community initiatives.

New co-operatives are also starting to deliver bespoke housing: instead of following the development speculative model that's in large part responsible for sinking Spain's economy, they put future users, like elderly people, in the driving seat to co-design and co-invest in their future homes.

Despite the crisis, they have managed to unlock significant amounts of money; for example, in Peñafiel in central Castilla, the Cocope co-op raised €9m in 2010 to build a 7,500 m2 care residence, and a not-for-profit co-operative of home owners in Cataluña, Lloc Nou, has already provided homes for 778 members (many of whom are disabled and cannot easily obtain adapted homes otherwise) and is in the process of developing more, having raised €226m in total.

Since the transition to democracy, legislative support for the social economy has been enshrined in the Spanish Constitution, which states that public authorities "shall efficiently promote the various forms of participation in the enterprise and shall encourage co-operative societies by means of appropriate legislation".

Recently, as part of the UN Year of Co-operatives, the Spanish Prince recognised the success of the co-operative business model in Spain at a ceremony at the Zarzuela Palace. The co-ops are confident that politicians are starting to take notice.

New partnerships

Nor is Spain's growing interest in social business confined to co-operatives. Universities in particular, are collaborating with young entrepreneurs to support several social enterprise initiatives across the country. The Barcelona-based Esade business school has teamed up with BBVA, one of the country's stronger banks, to build the Momentum Project that will provide young innovators with the training and mentorship needed to develop and scale their social businesses.

Telefonica's Wayra acceleration programme for innovative projects now also operates in the UK and Latin America, providing funding and support for concepts like Juntines, an online platform that suggests ideas for parents and children to plan together and strengthen intergenerational solidarity.

MIT's journal, the Technology Review, has for a second year running awarded 10 young Spanish innovators for their distinguished achievements in technology and business. One of their awarded projects with significant potential for social impact is the work of Juan Moreno, who is developing cutting edge systems of neural rehabilitation for persons with reduced mobility to address a key concern, as brain injuries is the most common cause of death for women.

Some innovators have drawn social concepts from abroad, like Actuable.org that was bought last year by Change.org and Goteo.org, the Spanish version of crowdfunding platforms. In other words, unlike the dominant narrative of a country licking its wounds or losing its brightest young people through emigration, Spain's most energetic entrepreneurs and companies are building the right partnerships for social innovation.

However, Dr Igor Calzada, in his chapter featured in the International Handbook for Social Innovation on Mondragón, advises innovators in Spain to reflect a homegrown approach to social entrepreneurship that steers away from individualist forms imported from abroad and to tend more towards community-inspired approaches as that taken by Mondragón when it was originally established.

Creating the spaces for social innovation

Brittany Koteles, consultant for AshokaU on social entrepreneurship in Spain and part of the candidate team for Hub Barcelona, notes however that it is still challenging for change-makers across all sectors to find the right allies and scale up this emerging movement.

This is why the arrival of a new generation of centres for social innovation is so important in Spain. Just like Hub Islington, which opened in London in 2004 not just to create affordable space as well as peer to peer contact for social start-ups, Koteles says that "in Spain, social innovation needs a neutral meeting place that is capable of curating the right connections and collaborations. That's what will give this movement momentum."

But leadership in this domain can also be seen in the work of some regional governments, such as Innovalab, the Basque laboratory for social innovation.

Gorka Espiau, one of its founders, believes that the public sector has a role in supporting new infrastructures to systematically identify and implement large scale social innovation projects. "By doing so, they would be creating the necessary ecosystem for business, academia and civil society leaders to collaborate with each other," he says.

He points out that the Basque country, where this has been happening for some decades, has among the highest education, health and GDP per capita rates in Spain – and that the region weathered the crisis much better than the rest of Spain.

Meanwhile, beyond the large city centres of Madrid, Bilbao and Barcelona, FlexiTalent has gone for the grassroots approach and is currently developing support systems for freelance professionals and entrepreneurs in smaller regional cities, launching their first FlexiHub in Oviedo, Asturias.

Equally, my own venture 2 Pueblo drew inspiration from UK-based social entrepreneurship to pilot a social incubation project with youth in Castilla La Mancha, a village in the region of Don Quixote. We are currently supporting young people in the village to market their local traditional food products in London, including a fabulous biological manchego cheese with rosemary, and in the process to also broaden their horizons and aspirations.

On 12 of November, we co-hosted a debate on the potential for social innovation in Spain, which was held at the Hub Islington to bridge projects across borders and knowledge sharing.

These three developments – recognising the role of co-operatives, new partnerships and emerging collaborative spaces for social innovation – are painting a different picture of Spain.

Christina Rebel is a social enterprise and sustainability researcher and speaker. She previously worked for We Impact, a social enterprise in China, and founded 2 Pueblo, a youth-led social enterprise project that promotes Spanish rural culture in London

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